For a device often called a USB "key," the tiny flash drives people carry around with them are generally not well-suited to being attached to a key ring. Most have plastic bodies, and in our experience, the plastic key ring loops inevitably break after a few weeks or months.
LaCie's IamaKey USB flash drive offers a potential solution with a new drive that is, amusingly, shaped like a key. More importantly, the entire device is made of metal, including the key ring connector at the top end.
As chronicled in this blog post, our main purpose for attaching a USB drive to a keychain is to have handy access to files. Testing several new laptops every week, key drives are useful for storing and transferring all the install files for software apps that should be on a new laptop, but aren't (such as Firefox, AVG Free, and Open Office).